Credit scores matter. They can determine what type of financial aid and car loans you are offered, which is why keeping your credit in good standing is essential. Here are some tips for improving your score and ensuring that you’re taking care of these digits. Learn more about Best credit score you can get.
1. Some credit cards will allow cardholders to temporarily spend their way out of a low credit score by transferring high-interest balances or making purchases with a higher interest rate than the card they’re moving from – this strategy isn’t recommended as the best long-term plan. Still, it can help build up a good credit score in time.
2. Enrolling in the PLUS Credit Card Program, where you are charged an annual fee of $495 but receive a credit score boost of 500 points, is an option to consider. While your payment won’t be small, you might find it worthwhile if you’re looking at a big purchase.
3. The FICO score is one of the most widely used credit scores since lenders and companies like Amazon use them to determine who qualifies for loans and offers. Credit scores are calculated by considering six factors: payment history, credit standing, types of credit used and types of credit sought, length of credit history, a mix of credit used, and the number of new open accounts per year.
4. Checking your credit score is suitable for your credit! It allows you to know how you’re being viewed by lenders, which makes you more likely to be approved for the things you want and need. The downside is that checking your score can negatively affect your score since it’ll be considered a “hard inquiry” – if you have to know what’s going on, try checking your credit score every few months.
5. The late payment fee that comes with credit cards can hurt your score if you have the habit of paying late. Pay your bills on time!
6. The length of your credit history is also a factor, though it does not show up in the FICO score, so you don’t need to worry about it as much. The amount of time you’ve had a credit account also matters – longer = better = more important to lenders.
7. Using more than one card is good, provided you’re using them responsibly! Mixing up the cards that you use is an excellent way to show lenders that you’re able to manage payments and pay off debts, which can boost your score. The number of cards isn’t a big factor, but the amount of debt that you have on each card is – try to keep your debt low since it means fewer payments per month and better credit.